Page 93 - KLIFF2022eBook

KLIFF 2022 PROGRAMME BOOK

Roles and Responsibilities

Previously, the 2009 Guidelines did not set out the roles and responsibilities of the Shariah adviser, such guidelines being
concerned primarily with matters involving registration and renewal of registrations only. In addition, the 2009 Guidelines also
“encouraged” (and did not make it mandatory for) such Shariah adviser to participate in continuing professional development
activities, to keep abreast with current developments in Islamic finance.
The 2022 Guidelines, on the other hand, set out specific provisions dealing with these matters, as follows:-

i. Roles of responsibilities of Shariah advisers, whereby a Shariah adviser must, inter alia, provide Shariah expertise and
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advice on Shariah matters in relation to the Islamic capital market products or the Islamic capital market activity, ensuring
that the applicable Shariah rulings, principles and concepts endorsed by the Shariah Advisory Council of the Securities
Commission (“SAC”) are complied with and applying ijtihad (intellectual reasoning) in the absence of any Shariah rulings,
principles and concepts endorsed by the SAC. This chapter further provides that a Shariah adviser must act with due care,
skill and diligence as well as providing the ways to deal with ambiguity or uncertainty relating to any Shariah matters, if arise.
ii. Continuous obligations imposed on Shariah advisers including
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a. fit and proper requirements to be complied with by such individual, corporation (i.e. its directors, chief executive and
Shariah officer), and financial institution (i.e. its Shariah committee members) Shariah adviser;
b. attending at least three Securities Industry Development Corporation - Continuing Professional Education approved
courses on the capital market annually; and
c. reporting to the SC where the Shariah adviser is no longer fit and proper.

Fit and Proper Criteria

One of the key requirements set out in both the 2009 Guidelines and 2022 Guidelines is the fit and proper criteria applicable
to Shariah advisers. Paragraphs 4.04 and 4.06 of the 2009 Guidelines laid down the fit and proper criteria according to the
types of applicants i.e. individuals and corporations. The 2022 Guidelines, on the other hand, has taken a different approach
by streamlining the fit and proper criteria applicable to all types of applicants, as set out in Appendix 1 of the 2022 Guidelines.

Conduct Requirements

The 2022 Guidelines has also introduced a new chapter on conduct requirements for Shariah adviser, which covers the
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requirements for the Shariah adviser to act honestly and uphold the principles of Shariah, as well as having adequate
arrangements in place to effectively manage or mitigate any conflict of interest.

Conclusion

All in all, the 2022 Guidelines is very much welcomed, as it provides more comprehensive and progressive guidelines for
Shariah advisers which are essential for boosting the growth and development of Islamic finance in the future, particularly in the
Islamic capital market industry.

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4 Chapter 6 of the 2022 Guidelines.
5 Chapter 7 of the 2022 Guidelines.
6 Chapter 8 of the 2022 Guidelines.

 TABLE OF CONTENT | PAGE 93 |